ROC(2) Pivot (Linda Raschke)

A daily bias level based on Linda Bradford Raschke's adaptation of the Taylor Trading Technique. The indicator plots a single price level — the point where the 2-period rate of change flips sign — and colors it by the current bias direction.

Concept
George Douglas Taylor observed in the 1950s that markets tend to swing in 2–3 day cycles: a buy day, a sell day, a sell-short day. Raschke formalized this with a simple calculation that captures where short-term momentum shifts.

The pivot is known before the session opens because it uses only prior daily closes:

Pivot = (Yesterday's Close − Close 3 days ago) + Close 2 days ago

Price above the pivot → long bias. Price below → short bias. One number, one rule.

Features

- Pivot line with bias-colored shading (long/short fill between price and pivot)
- Info table showing current bias, pivot price, streak, and respect score
- Streak — how many consecutive days the bias has held the same direction.
- Respect score — over the last N completed sessions, how many times did price stay entirely on one side of the pivot vs. crossing through it? Higher respect = the pivot is acting as meaningful support/resistance
- Alerts for bias flips (price crossing the pivot)
- Configurable colors, line width, fill transparency, table position/size, dark/light theme

How to use it

Check the pivot before the session. If price is above, favor long setups. If below, favor short setups. Use your own entry signals — the pivot provides directional context, not entries.

The respect score helps gauge conviction: if the pivot has been respected 7+ out of 10 sessions, traders are treating that level seriously. If only 3–4, the market is chopping through it and the bias carries less weight.

Non-repainting behavior

The pivot line itself does not repaint — it is calculated entirely from prior daily closes and is fixed at the open. The streak and respect scores use only completed daily bars (no intraday repainting). The real-time bias (line color, fill, table) updates as price crosses the pivot during the session, which is intended behavior — it reflects the current state, not a prediction.

Credits

Based on the 2-Period Rate of Change concept from Linda Bradford Raschke (Street Smarts, Chapter 8) and George Douglas Taylor's Taylor Trading Technique (1950).

This indicator is a visualization and context tool — it does not generate buy/sell signals and is not a standalone trading system.